Here are five tips for saving a little extra for retirement. Even the smallest amounts will work overtime for you in an interest-bearing retirement account.
By: Patty Kleen
Benjamin Franklin once said that a penny saved is a penny earned. He did have a valid point . . . even if, today, we’re more concerned with saving thousands than cents. Every little bit counts, especially when you consider the fact that even the smallest amounts will work overtime for you in an interest-bearing retirement account. Your retirement plan is in place; you’ve been building it for, perhaps, years now. What, then, can you do outside of what you are already doing to contribute to your future finances? Here are five tips for saving a little extra for retirement.
Sure, recycling your garbage won’t contribute to your retirement savings, but recycling your clothing will. Consider how much money you spend on clothing each year. Now consider how much that money would grow over the course of ten years in an investment account. Skip the shopping spree and, instead, pack up the clothing you no longer wear and trade them out for new-to-you finds at a clothing exchange store.
Cut Costs on the Home Front
Take some time to seriously evaluate your monthly bills, and find ways to trim them. It may be easier than you think. Do you really need a home phone AND a cell phone? Is it necessary that you have cable boxes in every room of the house? Could you still be comfortable in your house if you lower (or raise) the thermostat by a couple degrees?
Take a Second Job
This doesn’t mean your life has to center on work, but earning just a few extra hundred dollars a month that you can apply to your retirement plan can make a big difference in the long run. In addition to the extra money, a second, part-time job can also be a great way to increase your social circle or practice a hobby or interest.
Add One Percent
Contribute an extra one-percent of your paycheck to a 401K or work retirement plan. Because this amount is taken out before taxes, it will equate to less than one-percent of your take-home pay and, chances are, you won’t even know it’s missing. However, that small percentage can seriously fatten up your retirement account in the long run.
Cancel Unnecessary Subscriptions
Chances are you have a magazine subscription (or two) that you don’t need. You may even have a gym membership that you don’t use. If you can catch up on the latest news online, and work out at home, then you can save hundreds per year that can be added to your retirement account.
You don’t have to change your whole life around in order to boost your retirement savings. There are some small life changes you can make that will yield big returns down the line if you commit to saving just a little extra each month for your future financial well-being.
About the Author:
Patty Kleen is a full-time writer with a passion for personal finance. She enjoys writing about money saving tips, saving for retirement, and helping those with poor credit so that they can improve their financial futures.
Photo: Images Money